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Diageo GB’s full year results reveal impact of on-trade closure

Published:  04 August, 2020

Diageo’s full year results reveal a 47% fall in operating profits globally as a result of the pandemic, with net sales of spirits down 8% globally, and a 4% dip in the UK.

In a statement released with the results today (4 July), Diageo GB said that despite strong first half results and an upswing in off-trade sales during lockdown, those added sales had not been enough to offset the closure of the UK on-trade channel from March to early July. 

Dayalan Nayager, MD at Diageo GB, added that the cancellation of big cultural and sporting events, such as the Six Nations Rugby Championship matches, had “further amplified” the impact of the pandemic.

With regard to drinks categories, the company said rum and liqueurs had continued to grow, while scotch, vodka and beer had taken a hit, with the latter again down to on-trade closure.

Nayager highlighted that Diageo had “upweighted” its investment in and focus on e-commerce, while innovation also remained a "key focus”.

Examples included Gordon’s gin, which has benefitted from a series of new flavours including Sicilian Lemon, Mediterranean Orange and White Peach.

Smirnoff brought the new range of Smirnoff Seltzers from the US to GB, to meet growing UK consumer thirst for ready-to-drink beverages.

Diageo has also been active with support programmes for the trade during the crisis.

“As the British drinks trade faced one of its most challenging times ever, we wanted to help our communities where they needed us most,” said Nayager.

“In March, we pledged £1m to support bartenders’ wages and pledged over 10 million bottles of hand sanitiser to support frontline health care workers across 20 countries. This was followed by nearly £30m with Diageo’s Raising the Bar programme for the on-trade, to provide practical help and support to bars as they prepared to open their doors to consumers after lockdown.”